Asian Stocks: Japan's DoCoMo, NTT Rise; Taiwan, Hong Kong Down
quote.bloomberg.com
By Laura Lai
Tokyo, Sept. 8 (Bloomberg) -- Japan's Nikkei 225 stock average rose for the first time in nine days, led by NTT DoCoMo Inc., on an industry report it secured more than three-quarters of new cell phone subscribers last month.
The Nikkei 225 gained 201.09, or 1.2 percent, to 16,501.55. The broad Topix index rose 1.6 percent to 1509.88. DoCoMo also extended gains for a fifth day as executives convinced investors to buy its stock on a global promotional tour this week. NEC Corp., Fujitsu Ltd. and other chipmakers also gained, after U.S. semiconductor stocks snapped a three-day losing streak.
``It's obvious (DoCoMo) is the clear winner in the Japanese mobile market,'' said Hiroshi Motoki, a director of Japanese and Asian equity research at Alliance Capital Management (Japan) Inc., which owns shares of Japan's largest cell phone company. DoCoMo's market share of cell phone users ``should grow from the current 50 percent to 80 percent, or even 100 percent in the future, and I think investors are attracted to that.''
In other markets, Taiwan's TWSE lost 0.9 percent, led by Hon Hai Precision Industry Ltd. on concern about slowing electronics demand. Hong Kong's Hang Seng Index fell 0.9 percent, led by Pacific Century CyberWorks after Taiwan's GigaMedia Ltd. ended its venture with Asia's second-biggest Internet company. Korea's Kospi slid 0.4 percent to more than a one-year low, led by Korea Electric Power Corp. as investors bet rising oil prices would increase fuel costs and slow earnings growth at the nation's power monopoly.
NTT DoCoMo, Japan's No. 1 cellular phone operator, rose 5.5 percent to 3.25 million yen, and was the leading Topix gainer. Its parent NTT Corp. rose 3.2 percent to 1.28 million yen.
The two companies were part of six companies whose ratings were upheld by Moody's. The ``Aa1'' rating is now a grade above that of the nation's credit rating, which was cut to ``Aa2.'' Moody's said the Japanese government is running up too much debt in its efforts to spur growth.
DoCoMo has accumulated 16 percent in gains in the past five days, after it kicked off a promotional tour to meet investors. It was the most active stock by value with 45 billion yen in shares traded.
Chipmakers rose after Intel Corp., the world's biggest chipmaker reversed a three-day decline, as losses were seen as excessive. NEC, Japan's largest chipmaker that lost 10 percent in the past four days, rose 2.1 percent to 2,900 yen. Fujitsu, Japan's No. 4 chipmaker, rose 1.4 percent to 2,925 yen.
Korea
Korea's Kospi index fell 2.69 to 653.68, its lowest level since April 2, 1999. Korea Electric Power, the biggest power company in Korea, fell 11 percent to 29,000 won as investors bet rising crude oil prices would increase fuel costs and slow earnings growth at the nation's power supply monopoly.
Keith Nam, an analyst at ABN Amro, cut his recommendation on the utility company to ``sell'' from ``buy.''
``Investors are concerned the rise in crude oil prices could increase fuel costs and hurt the company's earnings,'' said Cho Min Keon, who manages $72 million at Templeton Investment Trust Management in Seoul. Cho recently reduced Kepco holdings in his portfolio to 4 percent from 7 percent.
SK Telecom, the nation's No. 1 mobile phone service provider, fell 3 percent to 224,000 won on concern the company's plan to invest in new mobile phone services may hurt earnings.
Taiwan
Taiwan's TWSE Index fell 62.94 to 7367.99. Hon Hai Precision Industry fell 6 percent to NT$235.00. In the last four weeks, three analysts have cut their earnings per share estimates for the electronic parts maker, according to research group IBES International Inc. Four analysts cut their estimates for the company's earnings in 2001.
Asustek Computer Inc. fell 4.4 percent to NT$172, after the computer motherboard and notebook computer maker warned last month that it wasn't meeting its sales forecasts because of a shortage of computer chips.
``There is down-side risk as people are worried about PC (personal computer) demand in the fourth-quarter and a slowdown in handset sales,'' which may affect the earnings of Taiwan electronic companies, said James Liu, who manages $135 million in Taiwan equities at ING CHB Securities Investment & Trust Ltd.
Depressing local investor sentiment was news that two retired Taiwan naval officers, Kang Shih-chun and Cheng Chih-po, were arrested yesterday on charges of fabricating official documents and acquiring illegal interests from the purchase of six frigates from France.
About a dozen Taiwan politicians and executives have been arrested since August, caught up in a drive by the administration of President Chen Shui-bian to eliminate corruption.
The anti-corruption drive may mean ``that a lot of the burden of capital raising in Taiwan falls squarely on direct means like the stock market,'' said Robert Horrocks, the general manager at Schroder Investment Consulting Ltd. in Taiwan. ``People are perhaps starting to worry there will be a large supply of equity coming out of the market over the next few months.''
Hong Kong
Hong Kong's Hang Seng Index fell 156.50 to 17,275.45. CyberWorks, Asia's No. 2 Internet company, fell 4.7 percent to HK$13.20.
GigaMedia, one of Taiwan's largest Internet service providers, canceled its plan to acquire shares in ERA Communications Co. in an alliance with CyberWorks, setting back the Hong Kong-based company's expansion plan in one of Asia's largest Internet markets.
CMGI Inc., a U.S.-based Internet investment company, said it will forego plans to start an international venture fund with CyberWorks to generate operating profits.
``It's a bit of a setback for CyberWorks as they want a pan- Asian network,'' said James Loh, analyst at Typhoon 8 Research Ltd., ``After Japan and India, Taiwan is the big market. The problem in Taiwan is that it is a saturated market, and CyberWorks need a joint venture with a Taiwan company to break into the market.''
China Unicom Ltd., a unit of China's No. 2 telephone company, fell 0.5 percent to HK$18.55. The company said earnings fell 37 percent in the first half even after taking a one-time charge of 1.2 billion yuan for compensation to investors who financed its network development. |
